Summary
- Shares have lost a third of their value since my August recommendation.
- I provide a recap of the bullish thesis and recent events.
- Opportunity for ELZONRIS in CMML and MF appears quite intriguing with a clear path forward in 2020 based on updated data (going after specific subsets, utilizing enrichment strategies).
- Up and coming competition in the CD123-targeting space should not be ignored.
- The stock remains a Buy for patient investors with a medium- to long-term time frame, as sales seasonality in Q3 is not likely to repeat.
- Looking for a helping hand in the market? Members of ROTY get exclusive ideas and guidance to navigate any climate. Get started today »
Shares of Stemline Therapeutics (STML) have lost a third of their value since my August article recommended buying shares given the fact that the Q2 report showed progress on multiple fronts.
Recently, at the ASH (American Society of Hematology) annual meeting, the company unveiled promising data from early-stage studies of ELZONRIS in myelofibrosis and multiple myeloma. This prompted my desire to revisit this story to determine whether there's a near- to medium-term upside opportunity for readers to take advantage of.
Figure 1: STML daily advanced chart
(Source: Finviz)
When looking at charts, clarity often comes from taking a look at distinct time frames in order to determine important technical levels to get a feel for what's going on. In the above chart (daily advanced), we can see shares spike in August after news that new technology add-on payment was granted to ELZONRIS (went into effect on October 1st). While Q2 ELZONRIS sales of $13 million easily beat estimates, the stock took a hit after a secondary offering was priced at $15.25 per share. In Q3, revenue came in under expectations, which also put some pressure on shares.
